ACB - Better-than-expected 3Q performance
We maintain a positive long-term view on ACB considering its healthy lending business, a loyal middle-and-high-profile customer base, strong liquidity, and sufficient capital buffers. An exclusive bancassurance deal with Manulife would be a strong driver for sustainable service income growth, given the upside of a rising bancassurance market. In bad cycles, prudent and effective core business, and the capability to expand a loyal customer base, and maintain leverage ratio were convincing arguments to support the belief of ACB outperforming its peers. However, the low risk appetite seems to be a double-edge sword, as we would not count on ACB to be a leading growth bank in a credit expansion cycle. Thus, ACB’s premium on the sector’s valuation multiples could not be too significant. We estimate the stock fair value at VND 29,950 per share. With no cash dividend over the next 12 months, total upside should be 13%. We reiterate our ACCUMULATE recommendation on the stock based on the closing price on November 13th, 2020.
Viet Dragon Securities belongs to top 20 biggest securities companies in terms of chartered capital in Vietnam. With a qualified, dedicated and professional team, a widespread network, advanced technology, diversified products and services, and good relationship with local and foreign institutions, we provide a wide range of services and products to our clients both individuals and institutions, both local and foreign. We commit to provide our clients with promising investment opportunities and a comprehensive and professional financial investment services.
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